Residents Association pondering move to oppose Miami Grand Prix

NEWS STORY26/06/2018

With just days to go before the drafting of a contract to host a Grand Prix on the streets of Miami next year, The Biscayne Neighborhoods Association (BNA) is pondering whether to lodge its opposition.

"We are now waiting for the contract that the City Manager will present to the City Commission, but if we don't have a clear understanding of the benefits that the race will bring to the City of Miami, we will consider opposing the City Commission approving the contract," said Andres Althabe, president of the BNA, according to Forbes.

Althabe says that following meetings with F1 officials and local government earlier this month there has been no progress leaving the BNA somewhat concerned.

"We have been disappointed on the follow through," he admits. "There was only one conference call after that and it was not with any representative of F1 but it was with a representative of the promoter who could not give any new information...

"They committed to have meetings with us regularly before the July 1st date when the City Manager will present a negotiated contract to the City Commission for approval... The meetings would be also to discuss the economic benefits to the City that were very unclear."

In essence, the BNA has two major concerns, the disruption caused by the event and the cost to taxpayers.

Watching the races on TV, everything looks so simple. The F1 circus arrives in town, pitches its tents, puts on the show then moves on.

However, Melanie Dawn, who attended the recent BNA meeting says that residents were told that "the set-up process would begin approximately three months before the races, and would require two to three weeks to tear-down afterwards."

At the meeting it was revealed that F1 is working with Richard Cregan, who was the driving force behind the Abu Dhabi and Sochi events, and that Cregan not only confirmed that this was the standard timeframe for the erecting and dismantling of a street track, but that most of the pre-race work "would be done at night", news that didn't go down too well with the locals.

Then there's the cost.

Traditionally, the costs are paid by the promoter and (hopefully) covered by ticket sales while the government pays the hosting fee as the event promotes the location... that’s unless you are Silverstone.

In Miami, F1 is looking to take a different route, a route that could prove to be the blueprint for the sport moving forwards under its new owners.

F1 will itself promote the event, in association with billionaire Stephen Ross who owns the Miami Dolphins NFL team, and while they will bear the costs of organising and running the event they will (hopefully) reap the rewards.

As Forbes explains, street races usually generate more money for a city due to the high concentration of hotels, shops and restaurants. On the other hand, street races tend to attract more locals than tourists. If the economic impact of an event is based on spending by visitors as opposed to locals it can paint a different picture.

The Canadian Grand Prix in Montreal, has an economic impact of just $65m according to the promoters, while, according to accountants Ernst & Young, Melbourne comes in at $42.7 million. This is the lowest of any F1 race and is almost seven times lower than that for the Bahrain Grand Prix, which is among the highest on the calendar.

However, in a recent report, the Miami Herald claimed that the impact of an F1 race on the streets of the city would be a "a whopping $700 million.", "more than half of the visitors will be from outside of the United States" it claims. In contrast, F1's three existing North American races get an average of 9.4%.

A street race is far costlier that one held at a permanent facility due to the amount of temporary structures and staff that are required.

"Rental of grandstands is one of the biggest single expenses with structures for 60,000 seats costing around $14 million," claims Forbes. "Staffing, admin and marketing comes to $12 million and then there’s the cost of the track itself.

"Securing a street course with safety barriers and fencing costs in the region of $8 million and a further $10 million goes on renting the pit buildings. Vehicle and utilities payments are around $1 million each with a further $2 million spent on catering and hospitality. Medical vehicles and equipment come to $1 million and there are $4.5 million of miscellaneous costs. Capping it all off is a payment of around $1 million for insurance.

"In total, the annual operating cost of an F1 street race is in the region of $54.5 million giving a total of $545 million over a decade," claims Forbes.

Although F1 and Ross are understood to be covering the majority of this, taxpayers in Miami could still find themselves with a massive tax bill... and that's assuming the event is the success Liberty is hoping for.

Following the BNA meeting, Melanie Dawn revealed that residents were told that "the City of Miami will be expected to contribute funds for security, waste disposal, track preparation and other expenses. Apparently, our contribution to these costs will be capped, but we were not told what that cap will be, nor whether the county or other Miami municipalities (like Miami Beach) will be sharing the costs since they will be sharing the benefits."

Residents and the authorities may well feel that F1 and Ross should foot this bill given their resources and their desire to see the race go ahead.

At least one bit of good news for F1 and Ross moving forward is that according to the Miami Herald the move by local groups to prevent the track running through a piece of land known as Parcel B - a three-acre patch of scrubland behind the AmericanAirlines Arena - has resulted in the proposed track now being rerouted through part of Bayfront Park before crossing over to Port Miami and back. Vitally, this avoids the AmericanAirlines Arena and the entry and exits to the Intercontinental Hotel.

That said, there remains talk of a cease and desist order to prevent the new route.

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READERS COMMENTS

1. Posted by Speedbump, 01/07/2018 22:31

"They already host their Miami Indy Car race, how different can the whole process be ? Sounds like another bunch of no life whiners that aren't happy unless they're complaining about something they know nothing about. Maybe they should just stick to organizing gay pride parades."